Blockstream, a digital asset infrastructure firm has just made an announcement pertaining to securing a huge fund. The firm has announced that it has successfully secured $125 million from a funding round.
Why the Funding Round
It did face some hiccups in the wake of the massive crypto market decline, but it has mainly remained resilient to such effects.
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Just when many would have thought that the mining industry is done for, the firm has made an announcement about raising a huge amount.
The firm has secured $125 million from the recent funding round and it is looking forward to expanding its business with these funds.
The officials have confirmed that they want to continue expanding their mining business. The money they have raised is going to go mainly towards the expansion of their business.
They will be expanding their network which would include the acquisition and launch of new mining facilities.
Where Did $125 Million Come From?
The executives were glad to reveal that they raised a large sum from the latest funding round. They acquired the funds in the form of secured loan financing and convertible notes.
According to the spokesperson at Blockstream, they are seeing a very high demand for hosting services. This means that the users want to have the mining firms mine Bitcoin on their behalf.
Therefore, they have to increase their mining power and for this purpose, they need more finances. This is the reason why the firm held their funding round to generate funds that would aid the business expansion.
The firm will be using the funds to increase its mining facilities and increase their hosting services. They want to meet the growing demand and the funds will be used to fulfill that purpose.
The focus is to provide institutions with the ability to gain from the mining facilities that will be hosted by Blockstream.
They have a very strong record and most importantly, they have a substantial scale that allows them to carry out mining operations on a large scale.
Blockstream’s Previous Funding Round
The previous (Series B) funding round Blockstream had carried out helped bring in $210 million.
After the acquisition of the funds, the firm increased its mining capacities by launching new mining facilities. This way, the firm was able to increase its mining capacity for institutions.
The firm was doing extremely well in August 2021 as well when the cryptocurrency market was hitting all-time highs. At that time, the cryptocurrency market valuation was about to hit $3 trillion.
It was at that time when the firm had expanded its mining facilities and empire on a very large scale. The first-ever funding round the firm held was back in 2016.
Blockstream has Remained Resilient
Throughout the year 2022, the cryptocurrency market faced a huge downtrend. However, Blockstream was among the firms whose hosting services remained resilient and untouched.
It continued mining Bitcoin for institutions through its hosting services. Despite the trading price of Bitcoin plummeting by 70%, the firm continued with its mining services.
By increasing the network, Blockstream is going to increase the mining competition for other major mining companies. The mining difficulty will also rise, making it difficult to mine Bitcoin even more.
This would result in pushing the trading price of Bitcoin to higher levels.
Due to the 2022 crisis, many major mining firms faced meltdowns. Some of the major firms including Greenidge Generation, Iris Energy, and Argo Blockchain faced major financial crises.
In the same year, most of the mining companies had to sell the BTC in their treasuries in order to make it through the difficult times.
Messari, a major blockchain research firm has revealed that in the entire year 2022, the largest mining firms mined 40,700 BTC in total.
Out of the total, 40,300 BTC were sold throughout the year, which means that they were dealing with their finances with the proceeds.